13 May 2020
The GroundUp article Coca-Cola and Cape Town’s sweetheart Day Zero deal seems to have purposefully omitted certain facts to achieve a particular (false) narrative. This has been a worrying and growing trend among ‘activist journalists’. Not only does the practice misinform readers, but it breaks down the public’s trust in the media’s ability to report fairly and truthfully.
The facts, as set out below, dispel the attempts by the journalists to paint the City of Cape Town as using the city’s most serious drought crisis to overlook the water consumption of industry in favour of “punishing” domestic customers.
The facts are that 70% of all water consumed in the City is consumed by the domestic residential sector, whereas 15% is attributable to commerce and industry combined. This is publicly available information and was shared over two years ago – as can be read in this News24 article. The City’s targeted approach for highest impact during the crisis was openly communicated from the start. This is echoed in the independent research paper “Cape Town’s Drought & Water Crisis” referred to in the article, which states:
“Before stringent water consumption restrictions were put into effect in February 2018, the City was consuming over 1 billion litres of water daily. The majority of this was consumed by upper- and middle-class households …” (Cape Town’s Drought & Water Crisis, April 2019)
The City’s response to the journalists’ question, but which they chose not to include, was consistent with these findings:
“As the bulk of our water in Cape Town is consumed by the residential sector, the City had to focus its attention on this sector in terms of driving down demand.”
If this key piece of information had been considered and included, the “Big business uses the most water and City gave them a free ride” premise of the article would be rendered moot. In order to effectively reduce overall consumption as quickly as possible, the rational and correct thing to do was to address the sector that consumes more than two thirds of the city’s water, and which had been heavily subsidized with 6kl of water free of charge across the board. We would not have defeated the drought if our residents had not played such an important role. Sacrifices were made by all sectors of our society as we overhauled our relationship with water to beat back the drought and become the world’s number one water-saving city.
Coca-Cola, the focus of the article, falls under the industry category, which, prior to the drought, collectively accounted for less than 4% of total water consumption in the city. Nevertheless, the article does mention that the company employs 1 300 staff, and it is thus unclear whether the suggestion is that these jobs (and those of other businesses in the industrial and commercial category) should have been culled, or indeed the more than 20 000 informal traders whose livelihoods depend on the sale of its products. It must be emphasized that all these statistics were openly shared at the time.
It is true that the City applies a flat tariff rate to the industrial, commercial and institutional (ICI) sector, but this has been incorrectly interpreted. This flat tariff is far higher than the lower steps of the domestic tariff. For this reason, commercial customers have found ways to reduce water consumption outside of the drought-related tariffs.
The City relied on this sector to reduce its consumption to make business sense by minimising their overhead costs. From Level 4 to 6, the ICI tariff increased from R23.55 to R45.75/kl ex VAT, and this punitive tariff was the mechanism to restrict demand in this sector.
Not all companies would have been able to achieve the same degree of water use reduction. Many offices and retail developments were able to achieve water saving by discontinuing irrigation of landscaping and installed water efficient taps, among many other water-saving interventions. However, industries where a high percentage of water is used is included in the final product, for example, juice and soft drink manufacturers, were less able to achieve water savings without cutting production and suffering major economic losses.
Along with the higher flat tariffs and other relevant charges applied to this group, commercial customers can’t access the kind of rebates residential customers can. When commercial customers are in arrears, their water supply is cut off completely, whereas residential customers are restricted and not entirely cut off.
The journalists are right to refer to their PAIA application when requesting account details relating to water use, as the City does not disclose confidential details of account holders to any person. While the City would not and does not prevent any account holder from sharing their own account details with whomever they choose, the City is not at liberty to share this information with third parties.
Regarding the tariffs, which we have already addressed ad nauseam, the price that the City was charging residents for water prior to the drought was for a long time not cost reflective, and all households received the first 6kl free of charge prior to the drought. This was not sustainable, especially in light of the reduction in the availability of our water supply. Along with driving down consumption, the City had to increase the tariff in order to make the product, and delivering the service, more cost reflective. Despite this, the City provides water at no cost to 40% of residents, and the free allocation for this indigent package was increased to 10.5kl.
All of this information has been made freely available and remains freely available. Unfortunately, the absence of fact-checking mechanisms in certain publishing houses, combined with an appetite for belief that the municipality is driving a malicious anti-poor agenda, creates fertile ground for activism being confused with journalism. Instead of building a story on a foundation of facts, the tendency seems to be to instead write from a pre-determined narrative, omitting what doesn’t fit.
The City categorically denies that it had any kind of “special deal” with Coca-Cola Pen Bev, or any other company. The City encourages readers to engage with the wealth of information available in the public domain in order to draw their own conclusions. This can be done by visiting the Think Water webpage, where we regularly provided updates and overviews of the water situation in Cape Town and the Province, and we remain the only South African city to have provided this much information during a period of drought and crisis. The paper cited in the article states that “the City’s management of its water is some of the best in the world.”
Caitlin Montague’s response to our article Coca-Cola and Cape Town’s sweetheart Day Zero deal is argument by insult, and does the City no credit.
She refers to an “absence of fact-checking mechanisms”. Actually the article was carefully fact-checked, apparently successfully, since Montague fails to point out a single factual error. If she had done so, we would correct it.
We are not sure what’s meant by the “activist journalists” jibe. The article was written by two veteran reporters. GroundUp adheres to the Press Code and attempts to report all stories accurately and fairly.
Much of Montague’s letter is devoted to destroying a straw man. We did not state or imply that business uses the most water as a sector. We’re not sure what to make of Montague’s argument that household consumption exceeds that of industry. Coke at the time of the drought was one of the ten biggest users of the municipal water supply. There are over 1 million households in Cape Town, as well as many small businesses, and none of them used anything close to the amount of water that Coke did. Readers can make up their own minds about the strength of the City’s reasoning.
Montague’s comments on our PAIA request are unhelpful. Despite a successful request, which resulted in some unintelligible information being supplied, and a successful appeal in which Speaker Dirk Smit instructed the Municipal Manager to ensure the information already handed over is clarified and that anything outstanding is supplied “forthwith”, almost a month later the City has failed to do so.
In his ruling, Smit made it clear that “councillors are precluded from intervention in the administration except as provided by law”, a remark which was almost certainly aimed at Councillor Xanthia Limberg, to whom Montague reports, and possibly other elected officials.
As for the article’s headline which the City has objected to, to our minds the Cape Town’s Day Zero deal was a sweetheart one for Coke. We didn’t say there was any “special deal” with Coke, and Montague has misconstrued the headline.